Contractual right to acquire property can support Article 226 challenge; apparent consideration must include non-monetary obligations.

A writ petitioner may maintain a challenge under Article 226 where a legally protected contractual right to acquire immovable property is directly affected, even before title passes. The note also explains that, for Chapter XX-C transfers, apparent consideration must be assessed from the true substance of the agreement, including non-monetary obligations and third-party remuneration such as construction commitments and brokerage burdens. On the facts described, the authority erred in excluding those elements and in valuing the construction obligation incorrectly, so the purchase order was beyond jurisdiction and could not stand.

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Issues: (i) Whether the writ petitioners had locus standi under Article 226 to challenge the order under section 269UD(1) of the Income-tax Act, 1961. (ii) Whether the appropriate authority lawfully determined the apparent consideration and could sustain the purchase order on the basis of the agreement and statement filed in Form No. 37-I.

Issue (i): Whether the writ petitioners had locus standi under Article 226 to challenge the order under section 269UD(1) of the Income-tax Act, 1961.

Analysis: A person invoking Article 226 must show a legal right that is directly and substantially affected. The expression "person interested" under Chapter XX-C cannot be equated with the wider concept of locus standi under Article 226. An agreement for sale may not create an interest in immovable property, but it can confer a legally protected right to seek performance of the bargain and to protect the contractual right to acquire the property. The challenge to the purchase order therefore involved enforcement of a legal right and was not barred merely because no title had yet passed.

Conclusion: The writ petitioners had locus standi to maintain the writ application.

Issue (ii): Whether the appropriate authority lawfully determined the apparent consideration and could sustain the purchase order on the basis of the agreement and statement filed in Form No. 37-I.

Analysis: The transaction was not confined to a simple sale for money. It included obligations to construct space for the transferor and to provide flats for the brokers in lieu of remuneration. For a transfer falling within section 269UA(d)(ii) and section 269UA(f)(ii), apparent consideration must be determined by reference to the substance of the agreement and the market value of non-monetary consideration, including the value of construction promised and the burden undertaken in relation to brokerage. The authority erred in treating the brokerage as incapable of forming part of consideration and in not properly valuing the construction obligation as on the date of the agreement. On that basis, the order directed purchase at an amount which was not equal to the true apparent consideration and was beyond jurisdiction under section 269UD(1).

Conclusion: The purchase order could not be sustained because the apparent consideration was wrongly determined.

Final Conclusion: The challenge succeeded on maintainability and on merits, and the impugned purchase order was quashed, with liberty to the appropriate authority to reconsider the reference in accordance with law.

Ratio Decidendi: In proceedings under Chapter XX-C, a writ petitioner may maintain a challenge under Article 226 if a legally protected contractual right to acquire immovable property is directly affected, and the appropriate authority must determine apparent consideration by applying the true substance of the agreement, including non-monetary obligations and third-party remuneration undertaken as part of the transfer.

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